Chancellor Rachel Reeves claimed the Labour Government was on course to reach its new homes target of 1.5 million homes.

In her Spring Statement, she said the country was set to achieve a “40-year high of housebuilding” at 305,000 per year.

Touching distance

This would take the overall total to 1.3 million by the end of this parliament, “within touching distance” of its aim, despite much scepticism in the building industry that it was possible.

Reeves also highlighted £2 billion of investment in 18,000 affordable and social homes announced earlier.

The Chancellor told the House of Commons that the Office for Budget Responsibility (OBR) forecast GDP (Gross Domestic Growth) growth in the economy of 1%, down from 2% this year, 1.9% next year followed by 1.8%, 1.7% and 1.8% in subsequent years.

Industry reaction

Timothy Douglas, Head of Policy and Campaigns for Propertymark, says: “The Spring Statement had a clear focus on the vital role housing plays in the UK economy and as part of the UK Government’s plan for growth, so it is encouraging to hear that planning reforms will boost national income.

“However, workforce challenges remain and it’s vital that local councils have the resources required to deliver effective planning and infrastructure so communities up and down the country and the wider economy really benefit.”

Iain McKenzie, CEO of The Guild of Property Professionals, says: “The Chancellor’s Spring Statement highlighted the potential impact of Labour’s planning reforms, with the OBR forecasting a forty-year high in housebuilding. If realised, this could be a game-changer for the housing market, helping to address supply shortages and improve affordability.

“However, while the government acknowledges the housing market’s significant influence on the wider economy, it remains frustrating that it is not being treated as a priority.

“Increased housing market activity drives consumer spending and economic growth, yet little was said about measures to stimulate transactions and support buyers,” he says.

“We need more than just planning reforms to truly unlock the potential of the property sector. Stamp duty reform, mortgage accessibility, and targeted incentives for buyers and sellers must all be on the agenda if we are to create a sustainable and thriving housing market that benefits both individuals and the economy as a whole.”

We’re going too slowly to hit the Government’s target of 1.5m new homes this parliament.”

William Reeve, CEO, Goodlord, says: “The PRS is creaking under intense pressure. A lot of this is attributable to supply and demand; there simply aren’t enough homes to go around.

“Today’s announcement that £2bn will be directed towards social house building is welcome, but the planned 18,000 homes barely touches the sides of what’s needed.

“We’re going too slowly to hit the Government’s target of 1.5m new homes this parliament, which in itself won’t be enough to close the UK’s housing gap. And we are falling behind our neighbours – the numbers are stark when you compare our housing stock with countries like France,” he says.

“This is being compounded by anti-market reforms. Despite the Government’s narrative about promoting growth and stripping away red tape, where housing is concerned it is doing the opposite. It is inhibiting the market from finding solutions that would reduce the amount of money the Government needs to pour into the sector.

Richard Donnell, Executive Director at Zoopla, says: “The housing market needs a strong and growing economy to support housing supply. It’s promising to see the Government focusing on longer-term impact by boosting funding for new homes and avoiding short-term measures like stamp duty holidays that don’t really help with the fundamental challenges in the housing market.

“The top priority should be an easing of mortgage regulations, which will support first-time buyers, an important buyer group for homebuilders and the broader market,” he says.

“This would also help the rental sector, where there are still 12 people chasing every home for rent, with those on low incomes bearing the brunt. Increased funding for social housing is essential in the upcoming Spending Review to help support housing delivery and boost the stock of social rented homes, which has been static for 30 years.”

Extremely disappointing

Colleen Babcock, Rightmove Property Expert, says: “It’s extremely disappointing that the government have not used the Spring Statement as an opportunity to extend the impending Stamp Duty deadline for those currently going through the home-moving process.

“We estimate over 70,000 buyers are going to miss the deadline and complete in April instead, and a third of those are first-time buyers.

“Given the current challenges faced by first-time buyers, our data shows that a typical first-time buyer in Britain now faces average monthly mortgage payments of £940, a 59% increase compared with £590 per month five years ago,” she says.

“Over that same period rents have increased by 40% across Great Britain. So, while we welcome the government’s focus and investment to help build more affordable homes, we’re keen to hear more about how this, or other incentives, can help more first-time buyers.”

Jeremy Leaf, north London estate agent and a former RICS residential chairman, says: “Our first wish was granted – the Chancellor didn’t do much, if anything, to deter existing activity in the housing market.

“The first way of dealing with a problem is to recognise it and the Government seems to have realised that there is a housing crisis.

“It has been widely accepted that affordable housing in particular is insufficient and improving planning is a significant contributor to that aim. Rachel Reeves said herself that it is too slow so the extra funding announced yesterday in the social and affordable homes programme is good news, although we still need more detail of where, when and how those spades are going to be in the ground,” he says.

“We are disappointed there wasn’t more direct assistance for the private sector, particularly SMEs who cumulatively can make such a big difference to the overall problem. Builders won’t build unless it is profitable for them to do so and there is reasonable prospect of adequate demand for the product envisaged. It would have been good to see some recognition of this.”

The planning reforms announced in today’s Spring Statement are a significant step forward for the UK housing sector.”

Jonathan Handford, MD at Fine & Country, says: “The planning reforms announced in today’s Spring Statement are a significant step forward for the UK housing sector — especially for first-time buyers struggling to get onto the property ladder.

“For too long, an outdated and restrictive planning system has held back housebuilding, creating a chronic undersupply of homes, particularly in high-demand areas.

“These reforms will help unlock land, cut red tape, and support responsible development, ensuring more high-quality homes are built where they are needed most,” he says.

“More homes mean more options for buyers, easing affordability pressures and making homeownership a more realistic goal for many.

“The housing market is a pillar of the UK economy, and long-term stability is key.

“Alongside planning reform, the government should consider further support, such as a modernised Help to Buy scheme and targeted Stamp Duty reductions.”